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Labor Board Settlements Will Seek More Money for Fired Workers

Sept. 15, 2021, 5:47 PM

National Labor Relations Board prosecutors will seek settlement agreements that pay workers for the economic consequences of alleged labor law violations, the agency’s top lawyer said.

NLRB General Counsel Jennifer Abruzzo told regional officials in a memo Wednesday to include consequential damages as part of settlement deals, following her call last week for agency lawyers to seek that type of novel remedy in litigation.

“Because Regions are less constrained by the remedies that they may seek in settlement, as opposed to those they may currently seek from the Board, Regions should skillfully craft settlement agreements that ensure the most full and effective relief is provided to those whose rights have been violated,” Abruzzo said in the memo.

The settlement memo is the latest in a series of signs that NLRB prosecutors will take a hawkish approach to enforcing the National Labor Relations Act under Abruzzo’s direction. Fully compensating workers in settlement agreements adds to her agenda to overturn Trump-era precedents, revive a potent type of bargaining order, and aggressively seek court orders.

While requiring employers to pay workers for the consequences of unlawful conduct would represent a new board remedy and require a change in the law, that idea has recently received support from the NLRB’s Democratic chief and a Republican member who led the board during the Trump administration.

Examples of consequential damages for unlawfully fired workers include paying workers for medical, legal, or moving expenses, damages to credit ratings, liquidating investment accounts to cover living expenses, and training to get new occupational licensing, according to the memo.

Settlement Deal Features

Abruzzo directed regional officials to seek agreements that require employers to sponsor immigration-related work authorization for any employees who lost that right due to labor law violations.

The NLRB’s top lawyer also reinstated the practice of including default language in settlement pacts to motivate compliance with the terms of those deals. That provision would give the NLRB the right to revoke a settlement if the terms of an agreement are not followed and rule on the original unfair labor practice allegations, with the charged party admitting fault.

Former Republican NLRB General Counsel Peter Robb, who President Joe Biden fired on Inauguration Day, had eliminated the required inclusion of default language shortly after taking over the agency’s legal arm in 2017.

Regional officials will try to require employers to include letters of apology along with reinstatement offers to unlawfully terminated works, according to the memo.

Non-admission clauses should be rare in settlement pacts, while deals with repeat violators may feature admissions of wrongdoing, the memo said.

To contact the reporter on this story: Robert Iafolla in Washington at riafolla@bloomberglaw.com

To contact the editor responsible for this story: John Lauinger at jlauinger@bloomberglaw.com

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